Owners of closely-held companies will not maintain ownership of their companies forever, and as such require a plan or exit strategy regarding how the owner will transition away from business ownership, business involvement, or both. Often, owners of closely-held companies have an exit strategy of selling their businesses as a way to liquidate assets invested with the business. Currently, in the United States (US) owners of closely-held companies represent about 8% of the population in the United States, and collectively employ between about 60% and 70% of all US employees.
For a portion of these owners of closely-held companies, a large percentage of the owners' assets are found in the companies they own. As such, the owners' have a substantial vested interest in a sale of their companies, whether the sale be to a third party, shareholders in an employee stock ownership plan (ESOP), company management, or some other type of buyer.
Current demographics in the US indicate that there are approximately 78 million baby boomers that are arriving at retirement age. These baby boomers are believed to own more than about 10 million businesses, many of whom will be interested in selling their businesses in the near future. The sale of a large number of businesses, including those businesses owned by baby-boomers, is expected to create an increased supply of businesses for sale on the open market, which will tend to decrease sale prices of those businesses and make sale of those businesses more difficult.